Essay
You are considering two lottery payment options:
Option A pays $10,000 today and Option B pays $20,000 at the end of ten years.Assume you can earn 6 percent on your savings.Which option will you choose if you base your decision on present values?
Which option will you choose if you base your decision on future values?
Explain why your answers are either the same or different.
Correct Answer:
Verified
PV of A = $10,000; PV of B = $11,167.90;...View Answer
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Correct Answer:
Verified
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